01—Abstract
Summary
Summary of the 10-K filed February 18, 2011. Cited figures are marked; the original filing is the authoritative source.
Republic Services, Inc. (RSG) filed its 2010 10-K on February 18, 2011, reporting on its performance for the year ending December 30, 2010.
The company, a leading provider of non-hazardous solid waste management services, highlighted the successful integration of its 2008 Allied Waste acquisition, which resulted in approximately $190 milliona in annual run-rate synergies, exceeding initial expectations. Despite a challenging economic environment, revenue remained relatively stable year-over-year, supported by price increases and efficiency gains, though offset by volume declines attributed to the weak economy. Financially, the company demonstrated a strong focus on enhancing shareholder value through debt reduction, achieving $1.3 billion in net borrowings repayment since the Allied acquisition, and initiating a $400 million share repurchase program.
The company also continued its quarterly cash dividend, increasing it in Q3 2010 to $0.20b per share. The report detailed the company's robust operating platform, experienced management team, and strategic initiatives aimed at improving profitability and customer service, including investments in technology and fleet modernization. Republic Services is well-positioned with a strong integrated operating platform and a clear financial strategy focused on free cash flow generation and shareholder returns.
02—Key points
Key Highlights
- Completed successful integration of Allied Waste Industries acquisition, realizing $190 million in annual run-rate synergies, exceeding targets.
- Maintained stable revenue of $8.1 billion in 2010, driven by price increases and operational efficiencies, despite economic headwinds affecting volume.
- Reduced net debt by $1.3 billion since the Allied acquisition and initiated a $400 million share repurchase program, demonstrating commitment to capital allocation.
- Increased quarterly cash dividend to $0.20 per share, signaling confidence in financial health and shareholder returns.
- Reported strong internalization rates of 67% for waste disposal at owned or operated landfills in 2010, enhancing cost control and operational efficiency.
- Operates a significant infrastructure with 348 collection companies, 204 transfer stations, 193 active landfills, and 76 recycling facilities across 40 states and Puerto Rico.
- Focus on environmental responsibility highlighted by 73 landfill gas and renewable energy projects generating electricity and reducing greenhouse gas emissions.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2010, Republic Services, Inc. kept $0.06.
- Revenue$8.11B100.0%
- Cost of revenue−$4.76B58.8%
- Gross profit$3.34B41.2%
- Operating costs−$1.80B22.2%
- Operating income$1.54B19.0%
- Interest, other & tax−$1.03B12.7%
- Net income$506.5M6.2%
Where FY2010 revenue went
$8.11B- Cost of revenue: $4.76B, 59% of revenue
- Interest, other & tax: $1.03B, 13% of revenue
- Net income: $506.5M, 6.2% of revenue
- SG&A: $858.0M, 11% of revenue
- Other operating costs: $944.7M, 12% of revenue
Kept 6.2% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2010filed February 18, 2011Financial Statements
FY2010 against FY2009
| Line item | FY2010FY2009 | Change |
|---|---|---|
| Revenue | $8.11B$8.20B | −1.1% |
| Cost of Revenue | $4.76B$4.84B | −1.6% |
| Gross Profit | $3.34B$3.35B | −0.4% |
| SG&A Expenses | $858.00M$880.40M | −2.5% |
| Operating Income | $1.54B$1.59B | −3.2% |
| Interest Expense | $507.40M$595.90M | −14.9% |
| Net Income | $506.50M$495.00M | +2.3% |
| EPS (Basic) | $1.32$1.30 | +1.5% |
| EPS (Diluted) | $1.32$1.30 | +1.5% |
| Shares Outstanding (Basic) | 382.99M379.70M | +0.9% |
| Shares Outstanding (Diluted) | 385.11M381.00M | +1.1% |
05—Questions
Frequently Asked Questions
What was Republic Services' financial performance in 2010, particularly in light of the Allied acquisition?
In 2010, Republic Services generated $8.1 billion in revenue, largely stable compared to 2009, despite economic challenges. The company successfully integrated the Allied Waste acquisition, achieving $190 million in annual run-rate synergies, surpassing its initial target. This integration, coupled with cost management, helped mitigate the impact of lower waste volumes.
How is the company managing its debt and returning value to shareholders?
Republic Services has made significant progress in deleveraging, repaying $1.3 billion in net borrowings since the Allied acquisition. The company also announced and began executing a $400 million share repurchase program. Additionally, it continued to reward shareholders through a consistent quarterly cash dividend, which was increased to $0.20 per share in the third quarter of 2010.
What are the key operational strengths and strategic initiatives for Republic Services?
The company's key strengths include a strong, vertically integrated operating platform across a national network of collection, transfer, and disposal facilities. Strategic initiatives focus on leveraging this platform through experienced management, a decentralized operating structure, and major programs aimed at improving safety, customer experience, cost efficiencies, and targeted profitable growth through both price and volume increases, as well as strategic acquisitions.
What is the company's stance on environmental sustainability and its renewable energy projects?
Republic Services operates 73 landfill gas and renewable energy projects, which capture methane gas to generate electricity and provide other energy benefits. These projects are highlighted for their contribution to reducing greenhouse gas emissions and offsetting fossil fuel use, demonstrating a commitment to environmental responsibility alongside core business operations.
06—Continue